European online car retailer Cazoo has secured $630m investment, to support its continued expansion in the UK and EU.
The financing will supplement Cazoo’s current strong liquidity position and will provide a material multi-year runway for the Company to be able to execute on its strategy over the coming years. The new proceeds, combined with Cazoo’s existing cash and cash equivalent position of approximately $260m as of December 31, 2021, will leave the Company with a pro forma cash balance approaching $900 million following the Transaction.
The investment is led by new investor Viking Global Investors, alongside participation from several existing shareholders including Mubadala Investment Company, D1 Capital and Willoughby Capital as well as other new and existing investors. Closing of the transaction is subject to customary conditions.
Alex Chesterman, founder and chief executive of Cazoo, said: “This transaction, where we have raised an additional $630m, further reinforces the strong belief in Cazoo from new and existing shareholders who, like us, are extremely excited about the huge market opportunity that we have ahead of us. We are now very well-funded for the coming years to continue to capitalise on this opportunity and deliver the best car buying and selling experience for consumers across the UK and Europe.”
Cazoo now has a proposition in the UK and an established position in each of France, Germany, Italy and Spain, the four largest markets in the EU. Together these five markets have a combined total addressable market (TAM) in excess of £300bn – £100+ billion in the UK and £200+ billion combined in France, Germany, Spain and Italy (the “Big 4” EU markets). The rest of Europe has a TAM of ~£175 billion, giving a total market opportunity today of £475+ billion.
Chesterman added: “Our strong growth in 2021 combined with the building blocks we have put in place, including this new funding, means that we are very well positioned to deliver on our plans and gives us strong confidence of meeting our medium and long term targets. We have navigated through some reconditioning constraints during the back half of last year and over the last few months we have seen our website inventory expand notably.”